Unity Employees ‘Mad and Stressed Out’ Amidst Unexpected Layoffs

Unity, creators of one of the most popular game engines used to power video games, is in turmoil. On Wednesday, Kotaku reported the company had “recently laid off hundreds of staffers,” a number Unity confirmed to Protocol to be “slightly more than 200 people.”

"I've been just incredibly mad and stressed out,” said one current Unity employee to Waypoint, who requested anonymity to avoid putting their own job in jeopardy. “It's been very eyebrow-raising so far. The firings are pretty questionable. Seems like they predominantly targeted a lot of junior devs and anyone whose manager was willing to throw under the bus.”

Two current Unity employees shared a copy of a memo to Waypoint that CEO John Riccitiello wrote in the company’s Slack last night, stating that “over the past few days, 263 employees across multiple orgs and 16 countries were notified that their jobs are being eliminated.” 

That number is roughly 4 percent of the company’s total employees. It comes just weeks after Riccitiello told explicitly employees in an all-hands meeting that layoffs weren’t coming.

“As part of a continued planning process where we regularly assess our resourcing levels against our company priorities,” said the company in a statement to Waypoint, “we decided to realign some of our resources to better drive focus and support our long-term growth. This resulted in some hard decisions that impacted approximately 4% of all Unity workforce. We are grateful for the contributions of those leaving Unity and we are supporting them through this difficult transition.”

In the memo, Riccitiello said the company would “expect” 50 of those employees could be moved to another role within Unity. Kotaku reported that severance packages included a single month's pay and extended COBRA health insurance, which is notoriously expensive. 

“We did not enter into this process with a target in mind of how many jobs needed to be eliminated, leading to sweeping cuts to every organization,” said Riccitiello in the memo. “Instead we designed these reductions to sharpen our focus, eliminate projects and initiatives that were not supporting priority areas, and reallocate teams to where they could add the most value. We examined every decision with a goal to do right by our employees. We did not rely on a last-in-first-out model, or seek to protect those based at headquarters, nor did we focus job eliminations on less senior employees.”

In closing, Riccitiello said Unity, which recently bought the digital effects studio Weta for $1.62 billion and streaming technology company Parsec for $320 million, was now “well-positioned to be more focused, and as a direct consequence, even more successful.”

The layoffs come amidst record levels of inflation sending prices of everyday goods skyrocketing, fears of a possible economic recession, and tumbling stock prices among technology companies. Many tech companies have laid off hundreds of employees in recent weeks. Unity’s own stock has significantly dropped over the course of 2022, and last year, Waypoint reported on the ongoing internal controversies over Unity’s decision to expand well beyond video games and into technology contracts with the U.S. military.

“I don't think many people believed it when John Riccitiello and Scott [Pitasky, Unity’s chief people officer] danced around the question of layoffs at the last town hall,” said the same employee, “trying to give the impression there wouldn't be any layoffs without making a hard commitment to not doing it. But I think a lot of people were still caught off-guard by just how brazenly dishonest they were being. They had no intention of not doing a company-wide layoff, they just weren't willing to admit to it until it had already happened.”

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